Why Should You Consider Forming An LLC In Florida?
Wondering which state to form your LLC in? Read further to find out why Florida LLC’s are particularly popular.
Let’s first start by considering what a Limited Liability Company (LLC) is. An LLC is one of the several US business structures that aspiring business owners can choose from when from their business, others include Corporations, General Partnerships and Sole Propiertorships. LLCs can be formed by one person as a single-member LLC, or a group of individuals who can form a multi-member LLC. What makes LLCs so attractive is that they offer the limited liability protection of corporations and the pass-through taxation of sole proprietorships and partnerships. In essence, forming an LCC is the best way to structure your business to ensure the protection of your personal assets in the event your business is sued. LLC are relatively easy to form and maintain, involving significantly less paperwork than corporations and other legal entities. Now why Florida of all the states in the US? According to TRUiC, most small business LLCs are formed in Florida because specifically of the start-up and maintain costs and way LLCs are taxed in Florida. Below is a more detailed list of benefits of forming an LLC, and why they are particularly popular in Florida.
LLCs offer personal asset protection
To put it simply, as an LLC owner, you will not be held personally responsible in the event that your business incurs losses or is sued, provided that no acts of fraud or criminal behavior transpired in the course of doing business. Although LLCs help in protecting your personal assets from being seized, this is not to say that further action isn’t required to protect your LLC’s assets. Obtaining liability insurance can help protect your LLC’s assets from lawsuits.
You avoid double taxation
Let me explain forming an LLC helps you avoid double taxation. As an LLC, the business’ profits will go straight to the owners, or in the event of multiple owners, its members. The owners then report their share of the LLC’s profits on their individual tax returns. The LLC’s profits are therefore only taxed once and not twice, once before profits are disturbed and again when owners report their share of the LLC’s profits on their tax returns. This is also known as pass-through taxation. In the State of Florida however you will be specifically required to register for one or more types of state tax, depending on the industry and scale of your business. If your business involves the sale of physical products you will need to file for a seller permit through the Florida Department of Revenue website. This form will allow you to collect sales tax on taxable sales. Additionally, if your LLC has employees in Florida, you will be required to register for Florida Reemployment Taxes, a type of unemployment tax, and also Industry Specific Taxes depending on the industry you want your LLC to operate in.
Simple to form and easy to maintain
LLCs are relatively simply formed and easily maintained with little paperwork. Unlike most other US business structures, LLC are not required to assign formal officer roles, hold annual meetings or record company minutes and resolutions. Forming an LLC can be done in a few steps, and if you want to start an LLC in Florida, all you need to do is file an Articles of Organization form with the Florida Divisions of Corporations and a fee of $125. You can file this form online at MyFlorida Subiz website, by mail or in person. Your Articles of Organization form, once filed, is the legal document that will officially form your LLC in Florida and allow you to conduct business.
The list has come to an end, but this is not to say that there aren’t more benefits associated with the LLC business structure. At TRUiC’s website you can learn more about the benefits of forming an LLC and with their help, the process of setting up an LLC in Florida will be even easier and go even faster.